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tv   U.S. Senate  CSPAN  May 31, 2011 9:00am-12:00pm EDT

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>> you mentioned some things that management has to resolve -- >> the executive management is gone. >> these are really strong -- [talking over each other] >> there's a two year clawback of compensation for senior executives. a lot of the benefit -- managers knowing this process -- they don't have the option -- this process is there and will be the scenario that gives them a strong incentive to raise capital and sell themselves in this. >> the second question is the follow-up on my friend mr. renacci's question about the conflict between copb and safety and soundness regulators. what is your view on that as it relates to the governing bodies that you discussed with my colleague from the other side?
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>> there is a close intersection. it will require a lot of collaboration with the consumer head. investor requirements and agencies that consult with bank regulators in writing rules. the fact the consumer head would be on our board would further that sensitivity and knowledge and awareness of the intersection of consumer protection. i think it can work. began his all about -- >> you have reservations to express these? >> not really. early on when congress was considering this week were sympathetic to a board approach. we have a board, even though it is more difficult for me. i am not a dictator. i have to get my five votes. the chairman of the committee has to do that but it is a good process so either way, you have those single heads and those models and financial regulatory spier's so i don't really -- i
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have reservations. there are arguments for either approach. to the statute as is, when we think we can work with it. ..>> of the kinds of things they might be doing a round consumer protections, they see a big conflict with these issues? >> particularly with regard to the board, one of the things that puts pressure and led to a lot of that lending was by competitive pressure to have a lot of nonbank mortgage originators and had no regulations whatsoever. they were selling these loans in the securitization trust. they weren't really driving down lending standards. having it for the nonbanks will actually help level a competitive playing field to mention that we don't have
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competitive pressure. >> thank you for your service, i appreciate it. >> of like to recognize him from texas for five minutes. >> the fdic report about the possible order liquidation, who they said had the resolution authority granted to them have been in place, the estimated losses to the creditors may have only been 3 cents of every dollar. officials at the federal reserve including chairman bernanke have stated that one of the primary reasons that the fed did not step in to save lehman was because the estimated losses were so large. and they did not have sufficient collateral to post. chairman bernanke stated in his testimony that there was not merely of collateral to provide enough liquidity to meet a run
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on laymen. the company would fail anyway at the federal reserve would be left holding the very large amount of collateral. the fdic seems to think that there was significant value in lehman while the federal reserve thought the risk was too large to lend to it. how could the federal reserve, such different conclusions? >> 97 cents on the dollar is a senior is not all the creditors the residue of bankruptcy, you work your way with equity at the bottom. because of significant equity, we think the bond holders with a taken very small hair cuts based on a very aggressive assumption about what the loss rates would
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have been. i think there is a difference between what is available for collateral panel was available to lend as well as legal constraints against the lending institutions that really drove his comments. the value of unsecured collateral shouldn't be confused with a broader franchise value of the institution have the ability of a significant losses. which they could not rely on because there is no resolution process that we have now. >> the difference of conclusions, was this discussed with the proposed rules for living wills? >> and and think there really is a difference. it was talking about equality, the very high standards for collateral. that was well over a billion dollars into the broker a deal.
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because the counterparties temple of their collateral out, it meant a lot already and was a very destructive process. items think we are inconsistent with what we are saying. it is a joint proposal. >> they called the past experience with an orderly wind down instructive. they argue that the fdic is readily equipped to handle the authority a quick because from 1995 through 20 07, he agency was responsible for the wind out of 56 financial institutions in hotbed questions as to just how readily they are to handle the new responsibilities. according to data from the web site, the total assets of those
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56 financial institutions wound down to 2007 was about $12.23 billion or an average $218 million per banks. most were smaller than that. at lehman brothers had $639 billion of assets. this is the largest bankruptcy in american history and it was 50 times greater than all of the combined assets of the banks that the fdic shutdown over the 12-year high time. what makes them wind down such a large institution? >> it may better attempt the failed bank assets over the past 2.5 years. washington mutual was over 300
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billion and was resolved over a weekend, a process that was not a similar. we ensure these banks and we understand them. and i get this question sometimes, people try to paint it. we ensure these big banks. regrettably participated in the bailout of some very large bank. unclear quite prepared. and complex financial structures, with a very smart people that do this for a living. we're the only agency and the world that has the experience of financial institutions, and others look to us. others look to us for expertise. >> my time is up, but i hope that the fdic has changed its
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own personnel and operating structure for the benefit of our financial system >> we are designed to expand and contract very quickly. we have reservoirs' of contractor helped because our work is cyclical. this is a challenge for us. and certainly compared to the expertise process, i think this is a good approach. how to prove to you that can work. >> gentlewoman for 5 minutes. >> last congress, this committee held a hearing to examine community bankers' concerns that regulators were being overly restrictive, as the ftse address this concern to work with banks to increase
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small-business lending? i am concerned with the ranking member of the house. we held a joint hearing in this committee to address a lack of access to affordable capital. i would like for you to comment on this. i think this is been a major impediment and certainly your expertise with the small business sector, you know that much better than i. and then there are a variety of reasons. i think risk aversion is part of it. our demand is driven by a couple of different factors. what is the uncertainty of how robust the economic recovery is. that is another downturn a year from now. that is a problem with the borrowed commands.
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because so much small band in regent small lending has dropped substantially, they don't have the collateral any more to borrow against. we encourage it and focus on it. i was very disappointed that balances were down in the first quarter. small-business lending was down. we want our banks to lend. with special want them to lend to small businesses and i think they obviously need to find creditworthy borrowers. they're still standing on the sidelines. >> they recently implemented in and day to expand the deposit insurance assessment which will result in community banks pay a 30% less in premiums while large banks pay more.
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what effect on small business lending will the new system have? >> i think it will help them. it will ease the assessment burden. is quite consistent with the loss exposure with larger institutions. it will help them and to the extent of the small banks to about 40% of the small business lending done by the depository institution. >> under the proposed rules for qualified residential mortgages, home buyers will have to put down 20% of the purchase price. we're very much concerned about this. because it will have a significant potential impact in high-cost areas like new york city. should requirement to be based
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on local market conditions? >> i think they are meant to be exceptions to the general that if you're issuing a securitization, you need to maintain 5% of the growth. i think that they should not have skin in the game with these loans by and large. it led to a lot of underwriting and abuses that we saw in the mortgage market. it should be the rule. it is meant to be in their own part of the market, and with a not very broad standard. if you maintain the risk or all of the, have broad flexibility. the only applies to what i think will be a small slice >> have you looked at any other alternatives to a down payment? it will reduce the number of
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defaults in the future. >> the staff of all of the agencies, it is a significant driver on whether a loan defaults. i will say that we are out for comment on exec to the question among others and i anticipate this is a huge issue that we get a lot of comment on it. that indicates the 20 percent down payment was a really strong indicator. >> you understand my point? >> i understand the point. this is a huge issue. what is a meaningful down payment for a low-income person could be very different for a meaningful down payment for those with other means. >> how do we meet those needs. and with the risk retention, you have a robust market and will
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have more flexible underwriting standards to me that's what and a continuation of the program. i would like to recognize the man for questioning. >> i think a lot of my colleagues here have been pretty impressed overtime with the straightforward way the responded to questions is not always the rule around here. let me say i have laid out for you the arguments that i think are made via the studies. that if there is this advantage, this resumption that a that is their systemically speaking, the show the same relative magnitude. to go back to the markup or the conference committee, i've put forward several amendments to
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try to overcome this tendency. one particular required the fdic to estimate at the outset of the resolution process what creditors would have received in bankruptcy and a limit payments to bankruptcy a hair cut at 20%. it would act as a sort of insurance mechanism against future write-downs. if following the resolution process under that scheme there were additional funds, the fdic would have the authority to pay back all or part of the 20% premium. that it sold the market this presumptions. we did not carry this argument, but i think it still holds true.
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especially for the most interconnected and largest firms. now the resolution process. we're talking here about short- term creditors. those creditors are going to be considered essential under the fdic proposed rule. lending to these large complex financial firms, subject to resolution authority is close to that. if these firms fail, creditors are going to be made whole or close to hold. these are going to be able to borrow more cheaply end of the will grow even larger and they will become even more significant, systemically significant. there is a second problem also
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that arises. to go back to again, it is the clawback provision. it is going to be very difficult to recover, and that is why you see this basis point difference. bankruptcy verses resolution authority for the large is not hard to see a situation for a recently built up creditors strongly argues that handing a over these sums may jeopardize their unstable firm this is an argument that regulators having just bailed out these creditors to name a financial stability may find very difficult to resist. additionally, there is no guarantee that a given predator will be able to pay back the difference between the advances and what they would have received under the bankruptcy code. and under this mandate. to the president
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richard fisher that recently said this about these arguments that i have made in the past. incredible big bank resolution processes will be difficult to enforce, especially when regulators are explicitly directed to mitigate disruptions to the financial system. as they are in the bill. i understand you believed regulators need a broad authority to handle a crisis. the unintended consequences here have got to be considered. if we were to look at tightening the language while working within the resolution authority mechanism, are the steps we can take to minimize the potential for abuse down the road? and the amendment i made earlier, is a hold water with you? is our way to get at that? a couple of things, we're all for tightening as much as we can. we want markets to come back.
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there is obviously a moral hazard. we need to market discipline to complement the regulatory process as a weapon against excessive risk-taking. remember, we will work with you. we're trying to allow this through regulation. please do not interpret that to mean that you're going to get it, because they are very much subject to loss absorption. one of the things with liquidity is a commercial paper. even though you lose the funding, you replace it with government funding. the present and for the short term should be that they are taking losses, too.
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and i find that for instance with the derivatives, maybe they don't want to, if there are counterparties under secured or under collateralized, to find an hour with uninsured deposits, it will be a mathematical determination, however well maximize recoveries, that is what we will do. we think of the statute does have limitations. we are trying to tighten those even more. i am happy to look at language and talked to you. there is nobody that wants to and this and more than you. >> i will thank the chair, her, and thank you for being here, i echo his comments. i appreciate your forthrightness. yet testified many times and we thank you for your service. all wanted to ask you, based on
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something you had in a written statement, he said that if properly implemented, it will not only reduce the likelihood of the future crises but will provide tools without resorting to taxpayer supported bailout are damaging the financial system? >> will lead to believe that we don't have future taxpayer bailouts. is to leave the door open. >> and that is his point, but we look at the breakneck pace of rulemaking, and you see regulators in many respects overwhelmed with the volume and the pace. you have concerns about the quality of the rulemaking? >> we are comfortable with it. we did not have the huge number of the way that they do.
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so i think we see that we are proceeding at a reasonable pace. for anything major, we're giving 60-day comments. at least from their perspective, we are comfortable with the implementation so far. i understand especially if the market regulation issues, there is a lot being thrown. a special with derivative oversight. the rule making these to continue. it might have some merit. a think it is important to continue to proceed, and a think the market needs to understand that these rules are being placed in the need that to adapt as well. once they know what the rules are, the financial sector is pretty good at complying with them and figuring out how to do it. some sequencing might well have
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some errands. >> with the harmonization? thus even on the international front, and the you hear different things from some. this is getting his sea legs, but it is forcing us all to get together have the staff talks regularly. having thus been a good deal of harmonization that includes the international front. they are really -- in addition to resolution authority, we have strong capital buffers. i think there has been the work of harmonization. and we should continue to focus on that. another is concerned about the treatment of derivatives rules, and we're talking with each other. that may be that sometimes you want some differentiation. wante probably going to more finish with the banks and
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then was completely outside the safety net. there may be reasons for differentiation. >> and his international harmonization, and they are shrinking from an international level and a level playing field. you mentioned capital standards. i understand, there is a balance here, i want to measure the width of safety and fairness, also want to make sure that we of lending and economic recovery. are you wrestling with that? the way that when you're going through this process? >> the primary focus has to be with the capital requirement, hitting that sector to be leveraged about the french rolls, it is more expensive than equity. a double hull not only provide a
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better buffer, it will help differentiate funding costs of the capital discussions have been targeted primarily at the larger institutions. have been larger institutions holding companies regarding the quality of capital. the companies have something called trust's preferred securities that ended up having that is only capital issue. >> my time is short, but i want to ask you about the trm. to insure the lower down payment, it will be part of the qrm. >> that is out for comment.
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there is a private sector mortgage insurer. i think those are the things early to think about. and mortgage insurance can be a good product, but do it was demand for it driven by markets or regulations giving them an extra penny? i know you feel about the markets the way i do and that maybe the trade off that we think hard about. >> was it you who said that you thought that consumer protection and safety and soundness or two issues on the same side of the coin? >> general abuses will end up
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costing banks money. but just banks. mortgages are a prime example. more of it was on the side of banks that consumers could not afford. the defaulted and a lot of losses incurred. >> when he sees going together, we want to make sure that the consumers are protected and treated fairly clear in will also want to have banks in the profitable, make sure that they are not going under? do you have a concern when we separate consumer protection from safety and soundness? the commented on the mission statement that there was no reference to safety and soundness. does that give you some pause or some concern? are you ok with the oversight that comes from outside?
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>> we support the consumer agency. there are different iterations early on, but i support the final outcome. we think it is a positive thing that they will be on the board because they will provide an interaction to make sure that they are considered together. >> they don't have that consideration. reciprocity,for but given that, i think that again, we're fine with how it came out. it is important to understand how it has always been separate from the enforcement process. >> he talked about reciprocity, and you don't really have its except to review what is coming.
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the standard is so high, you need seven out of 10 votes to overturn the rule and the director is one of the members. it is incredibly high, and he risked their, we're talking about playing russian roulette with the economy. i introduced a bill that will reduce the requirement to just a simple majority of some pretty significant folks. we talked about reducing the standard. but if the rule was inconsistent. it could be overturned. the thing that is reasonable that we have a different standard of how we can coordinate consumer protection with safety and soundness? >> there are a lot of things that all of us would have
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written differently. at the end of the day it was a compromise. we can support the final product. if it can work. >> can we improve upon it? >> if you're going to draw me into a situation where -- and thank you. >> i am from a more rural district with zero community banks, credit unions we don't have big wall street banks in our district and i hear this nonstop from my local bankers. we're talking about how they are crushed by some many rules and some any regulations. the impact that it has on them, we don't have the ability to diversify the cost. you may hire a lawyer or a compliance officer in the costs go up. that makes it difficult for us to compete with bigger banks. sometimes we can't even stand the market anymore.
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it is the lifeblood of the economy. and this is not stopped coming from them and i don't know if you're hearing the same thing or trying to figure out how we can still be safe. but still have rules that allow the local bankers and don't have anything to do with the financial crisis to do business. >> i think they have a point. every time you have a new safety requirements, the incremental cost of doing that will be significantly higher and we should do a better job of taking that into account. of all the problems, we have had a lot of them. this is a problem of scale that affects a very large service. if they're going to be a lot of new rules on servicing, and see a basis for and where in all of that on the smaller banks as well.
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the smaller banks have really been relegated. and we want them to diversify their balance sheets. the regulatory barriers, holding back into those lines of business may be an impediment. of like them to do more mortgages again. i think that we should look very hard at the structure. the issues are completely different. >> that is something you are taking a look at. >> and we have an adviser on community banking. there are a number of the ideas for making regulations more effective. at the very top we say it applies to community banks shot. we ought to the community bank impact and why it will apply the community banks. we're looking at more automation.
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recall the fdic can act where every year kid is going to update. >> i appreciate that because we hear that from the community banks. i appreciate your looking at that. i yield back. >> and the chairman has consented to go to a second round of questioning. and we're still going to be calling for votes in the next 15 or 20 minutes. i will go ahead and start the second round. i appreciate you spending time with that. we also had a discussion in the markup for the bills. on the differences or the interchange ability or not of safety and soundness and profitability for banks, one witness said that safety and soundness is used as a code word by the institutions as
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profitability. by trying to reshape or reform this, using safety and soundness, we are being accused of protecting the profits of an institution. and i think while a safe and sound bank may realize a profit, that is a good thing. a profitable bank is not necessarily safe or sound. could you comment on the surgeon and the interchange ability of that? often they are two sides of the same coin. a product does not serve consumers or the customer's long term benefits and it will be a product that loses money for you and can result in litigation exposure as well. we're seeing that with the relaxed lending on mortgages and the litigation on overdraft
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protection. having sensitivity from goods and business practices from the outside are eventually going to lose money. there will probably default or that could result in litigation exposure. on the other hand, i think you need to have -- need to have a full analysis of changes for the safety and soundness of how it is going to impact the financial health of the institution. and i think those factors need to be waived. you need to consult with the bank regulators. there are ways built and now. >> safe and sound consumer products will, and the long run,
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in your opinion, bring about profitability for the institution? >> yes. >> and while there is a distinction between safety and soundness and profitability, the un safe product or the one that takes it too far is eventually going to be a non profitable an instrument for the institution. >> my final question, we'll talk a little bit about commission and the one to draw you into a political argument on that, but in looking at your own commission, or corporation, the service the chair, have the vice chair. , it is going to be grandfathered out or however in july.
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it is a chair that we don't have. it is not such in the imagination to say that it will have to be senate confirmed. we have the independent director that also has an expired term. ande losing your expertise the longevity and history. another you're not really going far. in all fairness to you and to the corporation, this means to live on for me, it is a political statement. these appointments out and get the senate confirmed. let's have stability here or we will end up in a situation where there is an ever-changing transitional situation where it causes me concern.
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>> i have profound concerns and i am frustrated that there is not greater urgency. i am very worried about my agency. it could go down to the board members after i leave. the names are not up yet, and there are still vacancies. i think this is very urgent. [unintelligible] there are still reforms to be implemented in a comprehensive and effective way. having a two-member or three- member board making these decisions is not a good thing. >> having a director in place on july 21, this is a great concern
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for me also. 44 senators have signed a letter saying that they will not confirm anyone. other policy positions that they want such as losing the funding to the political appropriations process, it may make it more difficult for them to do their jobs. i think this is a tremendous abuse of the confirmation process basically holding the entire congress hostage, that you have to look -- we have to write legislation. five or six major editorial boards. the good government groups will
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remove it from politics or the democratic or republican perspective that these have gotten dismantled, disrupted, and destroyed for the consumer financial agency they will have to gut the entire agency and make it basically a non- performing situation. of leave the have a role to play in protecting consumers -- there is a degree of profitability that they will end up on the
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street and the overall finances were greater. you can go out and buy a house. it was so easy to get a mortgage. it became clogged and the system and helped bring down the financial crisis. there is a basic disagreement between the republican party and the democratic party. the democratic party supportscfpb. -- supports the cfpb. you have republican senators saying that they will not confirm anyone unless you do exactly what we want. using it, taking hostage the entire legislative process to get what they want. they have forced the president really with no other choice since he supports it and the overwhelming majority, they
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would like someone to look at their loans, their credit cards, their student loans and making sure that they are fair. making sure there is a fair playing field that consumers can understand what the terms are. that they are printing for everyone out there to understand. we have a basic disagreement between the parties. i do want to address my questions to our distinguished guest in the areas in which she has played such a fundamental role. i want to go back to the too big to fail, which is a big issue. i know it is the closest of the hearings we will be having. some have argued repeatedly that the financial reform law, particularly the orderly backwardation authority, perpetuates rather than eliminates too big to fail.
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i would like to ask you what is your assessment of the allegations that the authority perpetuates too big to fail. >> i do not believe it is in any way a perpetuation. two big to fail was with us before the crisis. it was reinforced by the bailout. we need to end it. dodd frank gives us the tools --.-frank gives us the tools. i think it is there. the clear legislative intent is there. as i indicated in my testimony, implemented effectively, it will and too big to fail. >> my time is running out. which part of the financial reform law did you think is the most critical to ending too big to fail? >> i think titles one and two. title to brings us the orderly liquidation authority powers for non-banks. we already have it for banks.
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the little one holds higher standards of -- title one hold higher standards of capital requirements. and they must demonstrate they are resolvable. >> i thank you for your testimony today. i think you for your distinguished service to our country. i think you for your non partisan response to -- i thank you for your non partisan response to questions and policies. i think you have done a wonderful job for our country. >> chairwoman bair, i think you for being here, for your testimony and your service to our country. the one question i asked before several other people already asked. so i am going to move to another topic. it regards the orderly liquidation authority. i know several times in your testimony today, you talked
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about you believe -- or at least the impression i got was you believe the fdic have authority over liquidation is better than bankruptcy. >> for financial institutions. >> for financial institutions. there are a number of people in the bankruptcy community that believe that if bankruptcy laws changed that bankruptcy would be better. i know a lot of it deals with derivatives. can you give me some ideas of thoughts where you might believe that bankruptcy would be better? one of the issues with bankruptcy is that we are looking out for the creditors as we wind things down. i would like to hear your thoughts on some things that could be changed in the bankruptcy code that would actually make bankruptcy better. >> i think you are right. how derivatives are traded is very important. we would love to work with this committee and the judiciary. we deal a lot with bankruptcy court. banks we resolve are frequently restructured and go into
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bankruptcy. we are quite familiar with the strengths and weaknesses of the process. how bankruptcy treats derivatives is a big problem. having the ability to require counter parties to continue to perform on their derivative contracts, versus now, where they have the ability to terminate the contract and clinical lateral, is quite disruptive and was a major problem. -- terminate the contract and claim their collateral, is quite disruptive and was a major problem. we were opposed to the kind of bailouts under cig. they went into bankruptcy process and were fine. the commercial paper was fine. bankruptcy worked just fine. i think there are ways to make bankruptcy work even better. for the larger entities, i think there will be a couple of things we can do that banks will never
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be able to do. first is we will be able to have a continuing on-site presence. we will have ongoing access to information about the counterparty exposure and concentration of overseas operations. with the bankruptcy board, we will be able to do that. similarly, we will be able to plan and work with the international regulatory community as an institution becomes more troubled, to find and identify any options for resolving our domestic entity if they have foreign operations. we do that now. we have resolved banks that are national -- international operations. one of our banks had a subsidiary in china and hong kong. we identified what we needed to do to make sure that work within our receivership process. we were able to keep the subsidiary in asia open.
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they got the regulatory authority to do that. it is hard to see how bankruptcy court could involved in that kind of international coordination in the event of a failure, or be involved in pre- planning. finally, we can be involved in the "support to maintain franchise value. -- in that liquidity support to maintain franchise of you. -- value. >> i am going to take the question. when you say you can provide immediate liquidity support, is that from the ability to go to the treasury? >> yes, for banks. we have the deposit insurance for banks, but for non-banks, we have the ability to withdraw from the treasury. >> that is where the root is of the perception. if you are going to the treasury, you are going to the
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taxpayer. >> we wanted to pre-fund a reserve. that did not pass the senate. i think it is a very important to emphasize that any funds that are provided through that treasury line have priority over everything else. they are paid off the top. i can't believe there have ever been any losses on that. you are not guaranteeing any liabilities for the non-banking institution. whatever assets are sold, that goes to treasury first. in the unlikely event there would be losses, it would be assessed on the industry, the way we assess now for deposit insurance. right now, there is no reason for fares of taxpayer exposure on this. that in turn, the fact that the industry would have to pay for any losses that would occur, in and of itself will create pressure against creditor differentiation.
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they will know that the receiver -- we would do this anyway, but if the receiver tries to show favoritism, the loss will go against the industry. >> thank you, madam chair. happy to yield any time you might need. i have really been enjoying this hearing this morning. i want to reiterate the comments my colleagues have made on both sides of the aisle about your candor and straightforward answers. we do not always get that and i think it has a positive effect on the members and the questions they ask. you said before you thought the financial system was healing but not out of the woods. could you expand on this? >> yes. i think they are still working through some trouble spots. loan volume is down. i think there may be too much risk aversion with some banks. there is also a lack of a borrower demand and banks need to make loans to make money. that is what they are supposed
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to be doing with their funds and equity to make money. longer term, as i said in my testimony and in an op-ed last december, i am worried about the pressure from the low interest rate environment on bank balance sheets. obviously, banks are heavily exposed to interest-rate volatility. specifically, their liabilities are shorter than their assets. anything we would do to undermine confidence in this, in the fiscal drink of the united states government, could have an adverse impact on financial industries. we hope these discussions can produce a long-term deficit reduction plan. the mortgage market, i think, as i mentioned in testimony, are exposed. >> that was my next line of questioning.
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you said we need to get mortgage lending going again. what are the barriers there? i hear, as i said a minute ago, from bankers and borrowers that regulators are tightening down and not allowing them to make those loans. >> i think i would put more of a priority on small-business lending. certainly, mortgages in housing is an important part of our economy, but we need to accept going forward it will be a smaller part of our economy. it got bloated and overheated. i do think we need ultimately -- there needs to be an exit strategy. we know that model does not work. >> do you have any idea what model might work? >> it is really outside my portfolio to recommend. i will say this. i think go one way or the other. i think this hybrid model where
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you have a for-profit entity with a backstop of providing non-profit support was a bad model. going forward, i would say if you are going to continue to have government support, making exclusive. charge for it up front. make sure that is where we stand in terms of what being is -- what is being charged for the credit support. make that explicit. >> explicit and narrower? >> explicit the way the fdic charges insurance premiums for default insurance, they charged that has the government charged a guarantee fee that accurately reflects the need. or get out. one or the other. >> there was some back and forth about lending standards. 20% is huge. i don't see how that works. >> that is the exception, not
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the rule. i think there are mortgages out there with 20% down payments, but that is meant to be an exception to the general rule. if you are going to securitized mortgages, you need to retain 5% of the risk. if you retain 5% rise, you have a lot of flexibility on the underwriting side. >> what sounds reasonable to you in terms of the down payment? >> i think it is a combination of factors. clearly, a borrower with a strong credit history and a low debt to income ratio -- there may be other flexibility is that you can provide. we provide them with banks now. but you need to have some down payment. >> let me speak one more question. liquidity, as you mentioned -- do you have a view of what we
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should be doing there? >> one thing we are doing is getting rid of credit ratings in our regulations. that is required by dodd-frank. we had already started telling banks they need to do their own independent evaluation of the creditworthiness of investments and cannot rely on ratings. we used to use ratings for our assessments and we have gotten rid of that. i think that has been in process for some time. like anything, if you are not using credit ratings, what are you going to replace them with? that is really a hard question. >> thanks very much. >> thank you. this concludes our panel. some members may have additional questions they may wish to submit in writing. without objection, the hearing record will remain open for 30 days for members to submit additional written questions and
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these people to submit their responses to the record. thank you for a very productive hearing. we appreciate your great service for our country. this hearing is adjourned. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2011] to [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]
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[inaudible conversations] [inaudible conversations] [inaudible conversations]
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[inaudible conversations] [inaudible conversations] >> the c-span video library makes it easy to follow campaign 2012. click on the tab and get instant access to events from announced and potential presidential candidates all searchable, shareable and free. the peabody award-winning c-span video library is washington your way. >> the u.s. senate is about to gavel and for a pro forma session. no legislative work. the senate is off this week but they are meeting every three days to prevent the president from making recess appointments. senators back to work on monday
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when they consider the nomination for a new surgeon general replacing elena kagan. she was appointed to the supreme court. the house is in session this week. they are voting today on raising the federal debt ceiling. that debate beginning this afternoon at 4:45 p.m. eastern time. live now to the senate here on c-span2. the presiding officer: the senate will come to order. the clerk will read communication to the senate. the clerk: washington, d.c., may 31, 2011.
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to the senate, under the provisions of rule 1, paragraph 3, of the standing rules of the senate, i hereby appoint the honorable mark r. warner, a senator from the commonwealth of virginia, to perform the duties of the chair. signed daniel k. inouye, president pro tempore. the presiding officer: under the previous order, the senate stands adjourned until 10:30 a.m. on friday, june 3, 2011.
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>> now available c-span's congressional directory a complete guide of the first session of the 112th congress. inside new and returning house and senate members with contact information including twitter addresses, district maps and committee so i wants and information on the white house, supreme court justices and governors. order online at >> at 10:30 eastern we'll be live from the heritage foundation as freshman allen west talks about defense spending. representative west is an iraq war veteran
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>> this morning "washington journal" looked at the 2012 republican presidential field including sarah palin who's on a bus trip through parts of the u.s. we talk with a reporter who's covering the campaign season. >> and we're back with chris good. he's the associate editor at the atlantic rights for the politics channel. is the website. chris, let's begin with the speculation over sarah palin and the headline in "usa today." it says that it's trailing her on her bus tour. is she running? >> guest: nobody really knows. she's on this bus tour. people don't know exactly where she's going to go on the bus tour. if she's going to go to new hampshire but when you look at the website she had, it's not like she's set up a schedule of places to go. it's kind of a hard thing to follow and speculate about. someone asked her, i believe, at gettysburg, are you running? and she said -- she said, i don't know. but the republican field is going to shake up a lot.
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sending some mixed messages a lot. i don't think anybody knows she's in but this is a pretty strong sign if she's going in a bus going east and down on new hampshire she's at least thinking about it pretty seriously. >> host: and she added to cnn eventually she would go to iowa. does she have to go to iowa if she's going to be running for president? >> guest: i think she does. i think that iowa would probably figure pretty prominently in her calculus if she's going to kind of really go for this nomination. she had some pretty good numbers in iowa since the 2008 campaign. you know, since then we've seen her approval ratings trail off a little bit but along the way she's kind of clocked in some really good numbers iowa, favorable to iowa republicans. at one point it was 30% at 2008. i think iowa would be a good place for her to go. i think she -- there's no reason for her not to, i'll put it that way. >> host: so what's the impact of her not saying whether or not she's running? >> guest: well, it's just a guessing game for everybody else. you know, if you're a guy like
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tim pawlenty, you know, if you're mitt romney what can you do but watch and wait and see what she's going to do. and, you know, i don't know if you want to plan what you'll do if sarah palin is going to run if you don't know there's not much you can do whether wait and see the followers of sarah palin will be turning out against you or if you're going to try to peel some of them off and it's not going to be an issue. >> host: what's the impact if she decides to get in the race? >> guest: i think it will be pretty interesting. it's hard to know how she will do. she polls pretty well. she's kind of hovering around second place right now. mitt romney is the clear leader in this case but the polling is really early so it's a name recognition and how many republicans out there know you and, you know, if a lot of them like you you're going to do well in the polls but we've seen mitt romney polling around 15%. sarah palin, i think, in the 12, 13% range so i think she would make a big splash in the race.
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that's no doubt. >> host: well, what do those poll numbers say about her support within the party? >> guest: you know, i think we kind of know that nationally people have made up their minds about sarah palin. she's always been seen as a divisive figure. she's on the bad side of 50% and among republicans people seem to like her. it's too early to tell when people are presented with a few options when sarah palin has to get on stage and debate with mitt romney and debate with some of these other former governors and people who might come out and attack her it will be interesting to see what happened? we haven't seen republicans taking swings at sarah palin. no one has wanted to do that for the last couple of years. the way that opinion coalesces after that starts to happen, who knows what would happen. >> host: and how much money is sarah palin raising with this bus tour? how is she doing? >> guest: i actually don't know the answer to that question.
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her organization, sarah pac has done very well but it's not quite at the level of newt gingrich. he has this network of groups that file differently with the irs. it's a little bit easier for him to raise money but sarah palin is pretty good at fundraising. mitt romney is also pretty good. i don't know what this bus tour is going to take in for her, but you can see it's generating interest, you know, people just kind of show up and they'll hear she's going to be there and show up and wait for her. in that respect it's a little bit like her book tour. she just goes around and people show up to see her because they like her. she doesn't need a whole lot of advanced work. i thinks her attendance at the motorcycle rally she only had one advanced person with her. it's automatic when sarah palin shows up, she can just draw people. >> host: well, it's a pac, sarah pac, are there legal limits to what she can do with that money?
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what are the constraints? >> guest: it's pretty similar to running a campaign. i think you're capped at $5,000 per person. so, you know, you can't just take in unlimited money for your group before you're running. so in terms of restrictions it's very similar to if you're running a presidential campaign where, you know, the federal level is low enough that you can't rake in a ton of money from a couple of donors. you have to spread yourselves kind of thing >> host: the governor has spread her to her website and she asks people to go to her website. i want to show you an ad for the bus tour that's featured on her website and we'll come back and go to your phone calls. ♪ >> we have a vision for the future of our country and it is a vision anchored in time-tested
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proof. freedom is a god-given right. and it's worth fighting for. [applause] >> the constitution provides the best roadmap for the more perfect union. [applause] >> these are these enduring proofs, and these enduring proofs have been passed down from lincoln to reagan and now to you. we know that our best days are yet to come. [applause] >> host: and sarah palin in the way of cnn poll comes in at 13% in third place behind giuliani who got 16% in this poll and romney got 15%. chris good, what do you make of those numbers. >> guest: it's interesting to have giuliani up there. i don't hear a lot of people thinking giuliani is seriously a candidate for this or seriously running. it seems like those polling numbers are more about people knowing who he is and having higher recognition. you know, he ran last time
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around. everyone knows him from the days after 9/11. it's just interesting to see a candidate that people don't think is going to win topping the lace you kind of have to discount that a little bit. and just look, you know, after giuliani who is it? and the fact he's polling does it mean people are unsatisfied with the field? does it mean people want someone else to get in. if chris testorff -- chris christie get in the governor from new jersey. >> we're showing our viewers right now the people surveyed were asked, and who would be your second choice? their romney 15%, giuliani, 14% and then newt gingrich who polled at 8% with the first question jumps up to third place at 10%. >> guest: yeah. i don't know if newt gingrich should be too happy doing better in the second place poll.
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i don't know if he's the type wanting to run second. when you figure different candidates in and out around and how people shift. you see the poll donald trump ran and it actually hurt sarah palin and now she's doing better if you look at the polls from a few different polling firms that come out. she's kind of bumped up a little bit. trump seemed to take a little wind out of her sails. i would be interesting who's numbers will go up and who's will go down. >> host: and we should note newt gingrich is in a three-way tie for second choice with michelle back money and sarah palin each coming in at 10%. michelle back money, is she running? >> guest: i think michelle back money is probably running. i think she's taken steps in that direction. i think palin's presence in the race might change the calculus for her a little bit. she has a problem as someone -- sarah palin part 2 or a sarah
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palin -- whatever, you want to call it. but i think she's beating back the impression that she and palin are offering pretty much the same thing. they've been pretty close politically. they held rallies together. michele bachmann has allied herself with sarah palin and you can see where people get this impression. >> host: we'll go to phone calls. sheli from virginia. 2012 politics is our subject. go ahead. >> caller: hello? >> host: good morning. >> caller: thank you for taking my call. sarah palin is not running for president. and the reason is she would have been a fox contributor a long ago. and i wouldn't photo for her anyway. thank you. >> host: all right. melissa, a republican in buffalo, new york. go ahead. >> caller: hi, thank you for taking my call. first of all, i wouldn't -- i'm a republican and i would never vote for sarah palin because if she couldn't hack it as governor and she resigned after two years
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in office, then there's no way in the world that she would handle being president. i really don't buy the story that she quit because of ethics investigations because her own lawyer confirmed that the reason she quit being governor was because of all the pressure that was put on her by all the critics. and secondly, i wouldn't vote for michele bachmann because she has this problem with rewriting history. i think another problem is during the 2008 election, or 2010, i'm sorry -- no, 2008, excuse me, during the 2008 election when obama was running this problem we had this problem where the democratic party started this rumor that rush limbaugh was the de facto leader of the republican party. and then the republican leader started apologizing to him. we need leadership in the republican party that isn't going to cow tow to a radio disk jockey with a loud mouth.
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>> host: for those who are running or contemplating a run. you already said who won't vote for but who you might vote for. >> caller: i'm seriously looking at herman cain as a candidate because i like his israel-palestine relations as far as the united states goes. and i like his ideas as far as, you know, the economy and where we should be going as a country. >> host: all right. chris good, what do you make of that caller's comments. >> guest: it's interesting to hear positive comments about herman cain. he's a guy kind of run at the tea party. he's the former ceo of godfather's pizza. he's a very smart guy. i think he has an advanced degree of computer science and worked at the navy developing ballistics. he's clearly a smart, charismatic guy who could draw some support, you know, we haven't seen him catch on quite yet. i don't think enough people know about him but he's certainly an
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intriguing candidate and it's interesting to hear melissa that the republican party needs leaders who are not going cow tow to democrats and to vote for any rumors they might start. what sarah palin is going for the fighter image and she wants to see someone who will stand up at president obama and really go at him. and to the extent that that might not be catching on, maybe that's a problem for her. >> host: let's go to ted an independent in minnesota, good morning. >> caller: good morning. i got a thing chris might want to look at former governor there and in minnesota, see, you won't do any tipping. all tips are prorated against their salaries. anybody in the hospitality industry. and the salary tax and then that money was taken and given to the stadium. now, governor pawlenty was in sole support for that and so was the republican of that last
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fall. they dumped bails of pennies on this dude. you should look into this because this is a character of this crazy man that's coming out of minnesota. >> host: so ted, you never voted for tim pawlenty, i take it. >> caller: why would you? you know, like -- i'm really not in the class class. i never knew that rich billionaires needed welfare like that. >> host: ted you're calling on the independent line. have you voted democrat. >> caller: i voted republican a long time ago and democrat. i'm an independent. >> host: okay. >> caller: all i'm saying check out michele bachmann some of her crazy stuff too. thank you. >> host: what about the governor, tim pawlenty's record in minnesota? could it come back anything but i don't know about that. are people looking into that? >> guest: first of all, i feel sorry for anyone that has pennies dumped on them and it's
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terrible and a pretty bad day for any candidate. pawlenty is running on his record in minnesota and then i think as we kind of delve about it and find out more about it, maybe people will start raising questions and start challenging him on it and that's a one of his selling points that he's bringing to his appearances when he goes out and speaks about stuff, he's talking about how he left minnesota in good financial shape and that's really what he campaigns on. he talks about negotiating with unions that's been -- that's fading a little bit of discussion now maybe but that's been a huge topic of discussion in national politics and the republican politics as we saw the wisconsin drama play out but pawlenty -- some of the talking points about how he negotiated better deals for taxpayers with unions so that's really -- you know, he sees that minnesota record as a strong selling point. >> host: the next phone call comes from dallas, texas. is governor perry going to run? >> guest: i don't know.
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that would be interesting if rick perry would win. he's suggesting that maybe, you know, texas should secede from the union hinting vaguely see ry in the race. it would be very funny and entertaining to see how he handles himself in that debate. anybody hinting at a run at it is tough to tell if they are serious enough. host: go ahead. caller: thank you for taking my call. i am curious to know how is it sarah palin's bus tour being financed? who is contributing to that? thank you. guest: i believe it is being financed through her political action committee. the restrictions are that are such that she has to take
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donations from people and not corporations, all financed >> individuals who gave her money or money from other political organizations they can transfer money to political action committees and i think the cap on that is pretty -- it's kind of low. i think it's around $5,000 so, you know, it's not like there's some company financing her bus tour or anything like that. it's just her political organization, the money she's raised. >> host: nicholas is joining us on the republican line from georgia. >> caller: yes. i wanted to say that as far as 2012 politics goes, i'm 17 years old. and 2012 will be the first election that i'm able to vote in. >> host: okay. >> caller: originally i wanted -- i set out three candidates. mike huckabee, herman cain and mitch daniels and now herman cain is the only one still in there and i really like him.
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i'm a black conservative and i'm the son of a black pastor but the ticket i really, really want to see in 2012 and i think we have a good chance of seeing is mitt romney and allen west. that's going to be a very powerful ticket to take it to the democrats and allen west is going to be a very good leader in this country. he has a good future and he may not accept a vice presidential position, but he has a big future ahead of him and that mitt romney ticket and allen west ticket is going to be pretty good. >> host: all right. that corresponds with this "washington times" headline gop pushes candidates to the right. are any of the candidates that we talk about the most or that have said they're going to run for sure, mitt romney expected to make his announcement this thursday, later on this week, are any of them considered the tea party candidates? >> guest: romney definitely no. i don't think romney is a tea
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party candidate. i think his past as governor of massachusetts kind of precludes him from running for that and, you know, since the rise of the tea party, mitt romney is one of the few national politicians -- national republican politicians who hasn't -- there's never a point where you saw mitt romney just drive hard for the tea party vote. you know, tim pawlenty, i don't know if he's a tea party candidate. he's kind of got some of the tea party talking points in his repertoire, you know, he's all for reining in federal spending. he takes shots at obama. but does he really have the feel of a tea party candidate? i don't know. part of the -- part of the tea party is, you know, these messages about reducing spending, not raising taxes but there's kind of an anger and a fire and an outrage associated with the tea party that, you know, i don't know if a guy like tim pawlenty, if you would really categorize him as an outrage candidate. palin, she could be a tea party
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candidate. tea party seems to love sarah palin, you know, newt gingrich he's kind of played for the tea party vote. he's kind of a fire brand when he wants to be. throws bombs at people when he's engaged in political fights. so he could -- he could vie for the tea party vote, too, i think. but the tea party vote is something that i think people will want to go for. no one has really secured it yet. i don't know if any one candidate will end up with it. we let them divided among candidates when all said and done. >> host: let's talk about the other side of the aisle. president obama's re-election bid. here's the associated press this morning it says president obama tapped into a record of nearly 15 million voters who cast ballots for the first time. a surge in registration that may be difficult to replicate next year. recent voter registration data shows that democrats have lost ground in key states that obama cared in 2008 and early warning siren for the president's re-election campaign. what do you make of that? >> that's kind of the question with obama's re-election
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campaign with the whole political arm of his presidency. you know, when he won, he brought to him people in who had never -- or maybe not never but were not actively engaged in politics. it was kind of a situation where people thought does this change things permanently? is this going to permanently shift the political landscape or are we going to see a different type of demographic and senators voting out and voting for democrats. has he expanded the base and to perpetuate that the democratic national committee sort of spun off his campaign and created this organizing group called organizing for america basically with the idea of keeping everybody engaged and involved and getting them to lobby on a grassroots level for legislative efforts. so health care reform, wall street reform. they try to get people together at their houses. in a nonelection year to sit around and talk about, you know, what they like and what they don't like what obama is doing.
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it's going to be a test to see if people really stay engaged in that. now, it went from the obama 2008 campaign and they kind of turned it to this group organizing to america and now it's back in the 2012 campaign and now we're going to see how this experiment of trying to get people to stay engaged in nonelection years which is a difficult thing to do and whether it's worked out and i guess we'll find out whether it did. >> host: "washington post" has this story. front page story, north carolina's new dynamics on display elsewhere in the south has said that the dynamics in north carolina that worry republicans a booming minority republicans and a-influx of minority voters and changing set of priorities are changing in the south and virginia and florida where obama ran in 2008. this time around he hopes to make a play as georgia and texas seeing economic and cultural changed elsewhere in the somehow. an obama victory in either would be a long shot but a win in any of those southern states would make it difficult for
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republicans to capture the presidency. can you speak to that strategy? >> guest: the last part is definitely right. a win in texas, a win in georgia -- that would be a really bad thing for republicans if obama was able to carry it. it would be a major victory if he did it. committee do it? that's pretty tough, you know. if obama carries texas in 2012, i think that is a big, big thing that no one will have ever seen coming. you know, it's -- it may be wishful thinking on the part of democrats to get out there now and say, yeah, we're going to win texas, we're going to win georged and present a strong image just to piggyback on what they did in 2008 because that was a really good year for democrats in the south. trying to get people to vote for democrats in north carolina, in virginia, to have the democrat carry that state, that was big. you know, we don't know if it's going to continue going in the next presidential election year, obviously, the memories is when
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it gets democrats but you have the momentum in north carolina in 2006 when people were disaffected by the iraq war and democrats started really getting their organizing game together at the kind of district, very, you know, neighborhood level. getting people together to band together because they didn't like what george bush was doing as president. so now we're removed from that. we want to know if that impetus for southerners to vote for democrats is still going to be there because that definitely is going to help to the obama shift. >> host: we'll go to baltimore, independent line, john. >> caller: thank you for taking my call. how are you doing? >> host: doing well, john. >> caller: i had two things. first thing is the congressional seats that are up for re-election should be more interesting than the presidential election, i think. but as far as the presidential
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elections, the incumbent usually does win but on a republican side, i would like to see herman cain or rick perry but ron paul, you don't hear much one way or the other about ron paul. he's got good ideas. i agree with a lot of his ideas. he could -- you know, if he doesn't get the republican nomination, he would make a good vice president, i would think. but i still think the -- especially the senate seats up for grabs are going to be more important than the presidential election. >> host: why do you say that john? and which ones are you watching. >> caller: well, there's more democratic seats up for grabs in the senate. i don't know how many in the house but the republicans control the house already even though i'm not really 100% happy
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with either party. that's why i'm independent. if you have a republican-controlled senate and house, you'd probably get more done whether the president is a democrat or a republican. >> host: john, on your point here's front page in massachusetts. it says the torrent small campaign contributions from around the country that flooded gop centers scott brown's campaign coffer ahead of his special election last year also all but dried up as the excitement generated by his campaign has faded and some of his votes have disillusioned rank-and-file conservatives. >> guest: that's a barometer election. when scott brown came in it was a major victory for republicans who took away the democratic super majority in the senate and, you know, republicans can't like hearing that that their candidate who was kind of a golden boy for a little bit, who
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sort of led their resurgence in congress before the last memory -- midterm elections he's not faring bad at home. if there's a canary in the coal mine saying is bearing that. scott brown came at a time when there was starting to be backlash against the president, against what democrats were doing and maybe a little bit of that has fated. he's in massachusetts and that's a democratic state and he's kind of had to find his way in congress. it's kind of a thing like the budget. and like the two senators from maine, olympia snowe and susan collins, you know, they're moderates. people want to see is scott brown going to side with them. nobody is too surprised when the two moderate maine side against the republican party line and scott brown is drawing tremendous attention from
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everybody and is he kind of in the middle or go with the republican party line. he's the first guy people ask when the ryan budget is how the what scott brown is going to do about it. >> we're leaving this and you can see the rest of the at congressman allen west a member of the arms services committee is about to discuss the future of defense spending in light of recent budget cuts. he'll discuss whether the military is equipped to defend the nation followed by a conflict of iraq and afghanistan. former senator jim talent who's a fellow at the heritage foundation. live on c-span2. >> and has adapted to protect america security and we have another such advocate today. a member of congress who is short on official seniority but long on experience and influence in defense matters. it is not too much to say that
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our yesterday has spent a lifetime of service and sacrifice for the united states of america which he continues in the congress of the united states today. congressman allen west received his bachelor's degree while on an rotc scholarship at the university of tennessee. he later on went to get a master's degree from kansas state university, both in political science. perhaps foreshadowing what was yet to come. he holds a master of military arts and command in political theory and military operations. i'm going to embarrass the congressman a little bit by talking about his army record. he's been honored many times in his service in the military including a bronze star, three army commendation and one with valor. he received his valor medal from desert shield and the desert storm.
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oef he prayedly army parachutist badge the navy marine corps parachutist insignia. he represents florida's 22nd and i'm told the only issue where he may not reflect the views of his constituents is that congressman west is an enthusiastic fans of the tennessee volunteers and i know enough about -- [laughter] >> i know enough about florida to know that probably gets him in a little bit of trouble but he nevertheless was elected to his first term in congress. we all hope for the nation's sake and believe he's going to have many more. ladies and gentlemen, our honored guest today, colonel allen west, a congressman from florida. [applause] >> well, thanks so much for that introduction and, yes, being a proud volunteer, i got to kind
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of be concerned about some of the decisions our athletic director has made recently with lane kippen and bruce pearl with the basketball team and -- but not the ohio fans who woke up to some pretty bad news but it's really an honor to be here and i was just reflecting what danny says with the heritage foundation the new facility was being built i had the opportunity back in 2008 to come and meet with danny and during my first run for congress and, of course, we fell about 5 percentage points short but to now be standing here on this stage is just absolutely phenomenal. and danny, i want to thank you for all you've done for me for the past three years and all the support and encouragement and wisdom that you provided me to help me become an even better conservative leader for our country. so thank you very much, danny, for that. [applause] >> we're here today to protect america and the whole purpose is for me to kind of bring my experiences from the battlefield
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here to washington, d.c. i served in operation desert shield desert storm, iraqi freedom and also i spent 2.5 years in afghanistan wrapping that up back in november of 2007 working with the afghan military down in kandahar. and i have titled what i want to present to you today is the 21st century battlefield because i think as you look at the paradigm of battle and combat operations today, it is totally different from what i experienced back in 1982 when i was commissioned as a young lieutenant and it was very simple. you have the soviet union on one side and you had us on the other side. we knew their tactics. we knew their equipment. they knew our uniforms. every now and then we'd play some games on border patrol missions but that has totally left. and so how does the united states of america -- if we're going to be successful in protecting this country, how do we quickly adapt and understand this new battlefield? and be prepared to go out there and have success and victory? because this is a very complex
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battlefield. i can tell you in desert shield and desert storm in 1991 it's a totally different situation when i went back as a battalion commander in 2003. so how do we understand these complexities and how do we make the change? how do we understand this global conflagration in which we are engaged? because i have to tell you i think the future is going to be more than the nonstate, nonuniformed belligerence that we. and unless we can get a strategic level perspective, we never lose at the tactical level on the ground. we have the best soldiers, sailors and airmen and coast guard that the world has ever known. but the feeling is if they don't have the right type of strategic goals and objectives and they don't have the right type of operational goals and objectives that then filter down to the tactical level, it's very much like a hamster. no matter how much exertion you're putting on, on that wheel, you're just going to get
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tired of not going anywhere. and that's not what i want to see happen. i don't want to see a repeat of what happened in vietnam. where we won on the battlefield constantly. but at the strategic level that's where we did not have a focus and that's not where we had a great objective. so i want to start off with this. you know, when i hear people talking about war on terror, i think that's an incredible misnomer because a nation cannot go and fight tactic. it would be just the same as if we said world war ii, the united states went to war against the blitzkrieg. or in the pacific theater they went to war against the kamikaze tactic. what has to be presented for us to be successful on this 21st century battlefield is an understanding of who are we fighting against? because when i hear people talk about well, we're at war with al-qaeda. we're just at war with the taliban, we're we've so narrowly defined this to the point where
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did we go to war to fight against the twelfth german panthers division? did we go to war to fight against the 55th infantry japanese regiment? if you narrowly define yourself then you create gaps then we can be exploited. remember before al-qaeda the terrorist group that had inflicted the most damage upon the united states of america was hezbollah. and if you do the research and see what hezbollah has become. it's a nonstate, nonuniform belligerent armies. very capable military. such capable military right now that they have missiles in their arsenal that can strike every city in israel. but yet we don't see them as being part of an enemy. you know, back some time ago in the early 1800s we had an incident with some folks we called the barbary pirates and here we are in the 21st century
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battlefield we have the exact same and we have these individuals called the somali pirates but yet we don't know how to contend with them. that was one of the questions that i asked one of the defense legal team when they came over to testify. how do you classify the somali pirates? are they just criminals that when they kill americans as we know they did with those four individuals who were on a u.s. flagged commercial vessel, their own private vessel and we give them constitutional rights and bring them back or do we see them as 21st century battlefield or do we see them as an islamic terrorist army? that is what we must come to understand. we must come to contend with because if we don't have strategic-level objectives to fight against this army and don't identify who he is, then you're going to cause so much confusion for the men and women on the ground who are trying to go into these theaters of operation and fight and be successful. i'll ask you a question, what was the last time you heard
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anyone over the past 10 or so years say, these are our strategic objectives as we prosecute this current war? i hadn't heard it. that's what's missing. these are the four strategic objectives we should have. first of all, you got to deny this enemy sanctuary. see, the number 1 aspect that our military has is strategic mobility. and when you take it away by setting a military down in iraq or afghanistan and you get focused on nation-building and occupation type of warfare, then you take away your number 1 advantage, that mobility. you make your military a target and i can tell you there just aren't that many roads that come out of these fobs, forward operating bases, so you make it easy for our men and women to be attacked. so when you come back and think about our number 1 goals to deny the enemy sanctuary, that means
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whatever this enemy, try to present himself, you have to be willing to go and strike his capability. because you're contending with an enemy that has no regard for borders or boundaries or things of that nature. and so, therefore, you have to step outside your comfort zone and be able to take the fight to this enemy. to take the initiative away from him. instead of playing this little game like i saw us playing in iraq for a while called whack-a-mo [laughter] >> and we come back and fight back and we go over to this large base and he goes over there. if you study what alexander the great when he took the large macedonian failings and he split it up in into smaller detachments and they got out and they took the sanctuary away from the enemy, the exact same thing we did in vietnam. with the strategic hamlet program where we got out in the countryside and we denied the
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vietcong the resources that they needed. but when we pulled back and stopped the strategic hamlet program and got wired down, mired down on these large bases, they went into the countryside. and if you want to talk about the success that we had in iraq with the, quote-unquote, surge, it was that when we took ground, we held ground and we stayed out there and denied this guy his sanctuary. we dried up his molholes. that's the type of strategic we need to have. and the second thing very clear for a sfreej objective is that we must cut off his flow of men, material and resources right now. because as you know, i mean, when you put the iraq on them in iraq then they transfer over to yemen or they transfer over to afghanistan and we must be able to follow them. we must be able to cut that off. we have to interdict his flow of resources because that's how you
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dry up his ability to fund himself, to resupply himself and also to replenish his ranks. but yet we have not really been able to connect the dots and understand that. i mean, already we see a relationship that's building between the somali pirates and the operations that's happening there in yemen. not too far across the waterways they have to transit. the second most important thing. the third most important thing from our strategic perspective, we must win the information abrasion war. we never do a good job with that. they are killing us on these terrorist websites. they're getting their message out. we're not getting our message out. when i remember what happened with israel on that flotilla and i was there and i was watching that tape and i told my wife those guys have got paint balls on their back and she said i can't tell. but yet what happened the other side took that and they turned israel into the aggressor.
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we've got to do a better job of beating them as far as the messaging. we've got to do a better job of getting the word out. we got to do a better job with our psychological operations units. when i was in afghanistan one of the simple things i asked of the state representative i was down in kandahar, why aren't we establishing more radio stations on some of these larger bases that can broadcast locally? get some of these young afghan soldiers on and talk about what they're doing, talk about the pride they're having in their country. talk about the things that the taliban is doing so you can turn people. and if we don't understand that at a strategic level and part of that is our own media. i hate to tell you. you know, i've seen most stories about us doing things like abu ghraib. how many pictures did we see about abu ghraib? than i see about the bad things the enemy is doing. you know, just last week we lost
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over 14 soldiers in afghanistan. i don't hear anyone talking about that anymore. when our media sees themselves as a ideological political wing, i got some serious concerns about that. because the part of a nation's power, the dive theory, diplomatic, informational, military and economic, and if we can't take our own information and national power and use it as an asset force then we'll lose our country. the last most important strategic objective that we have to have is we have to cordon off this enemy and reduce his fear of influence. we've together shut down where he is and we're not doing that. we're allowing them to come into the united states of america. what happened with major nidal hasan should not have happened in the united states of america and i was stationed at fort hood texas. and anyone that wants to doubt
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that's part of the 21st century battlefield, you got your head in the sand and, unfortunately, when you put your head in the sand, unfortunately, you expose a certain part of your anatomy. [laughter] >> and that's what we're doing in this country. we're turning a blind eye to a very bold enemy that is telling us exactly what he wants to do. but it is up to us and it's up to our elected leaders, it's up to your strategic level, military officials to come up with the right type of strategic perspectives in order to combat against them. it's not a war in afghanistan. it's not a war in iraq. those are combat theaters of operation. that's that second tier. the operational fear of warfare. up here, is just the strategic fear. where we have missed out on the right goals and objectives. the next thing i want to talk to
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you about next is very simple. we got to talk about the economical setbacks and if you go back and look at what happened with the collapse of the soviet union. the soviet union did not collapsed militarily. the soviet union collapsed economically and there's one company paid really close attention to what happened and that country was china. and now we find ourselves on the 21st century battlefield. there's kinetic battles we are fighting and there's nonkinetic battles that we're fighting and the noneconomic battle we're fighting and we're providing an advantage to china. the trade surplus that they add up and the fact they own 20 to 30% of our debt. china is not taking that to improve the standard of living of the chinese citizen. china is taking this economic advantage that they have on the 21st century battlefield in about 8 to 10 years the world's largest blue water navy is going
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to fly under a chinese flag. now, why is that important on the 21st century battlefield? well, i just have to tell you, 70% of the mass of the earth is water. and you can go back to all the great civilizations, at the turn of the century, the portuguese or the spanish, the dutch, the english, the japanese. everyone knew that the means by which you extend the power and the reach of a nation and it's going to hurt my heart saying this. [laughter] >> is not through a great army. it's through a powerful navy. [laughter] >> and in 1990, we had 546 naval war vessels. today we have 283. and if you cannot protect the sea lanes of commerce, if you
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have four americans who get murdered right under the shadow of a naval vessel, then that bodes future problems for our country. it's very important for us as far as economic impact where i am in my district because we have port everglades. the world's busiest crews terminal and it's very important that the panama canal that will be expanding but it's the panama canal that the united states is built is now controlled by chinese contractors. that's how if you don't have a strategic perspective of the 21st century battlefield, the next thing you know you wake up and you find yourself militarily defeated maybe but also economically defeated. and another part that is so important on this 21st century battlefield is energy independence. now, i remember being back in georgia in the late 1970s when we had this little saudi oil
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embargo crisis thing. you had the even days and the odd days well, my dad was not going to sit in that lincoln continental days on his georgia days. he told his son to go out and park that gas so i have a distinct understanding of what energy independence should mean. [laughter] >> we created an governmental agency called the department of energy which is one mission to make the united states of america independent. but yet, where are we? and see if we don't recognize the fact that there are certain countries that are using energy resources as a weapon on this 21st century battlefield, once again we lose. see when russia went down and invaded the former soviet of georgia there was not a lot of contentious because of the natural gas pipeline. if we don't understand the saudis and what they are able to hold us or venezuela and hugha chavez and you just heard what hugo said last week.
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if there's a time when we should look at united states of america and say we are going to commit ourselves to being independent independent the time is now. and i get tired of hearing people say it's going to take 10 years. it's going to take too long. read the story of the uss yorktown after the battle of coral sea when it was so severely damaged that it went back to the pearl harbor and it would take six months for that aircraft carrier to go back out and be prepared to sea. and then its challenge is its sailors and those contractors and the yorktown steamed out in about three weeks. and it married up with the rest of that pacific fleet at a place called midway. and the rest is history. you see the american people will respond to a challenge and they will respond if they have strategic vision and that's what we're lacking in our country right now and i don't want to
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see us suffer because we don't understand this current battlefield and the direction we should take. we have to get ourselves off of the dependence of foreign nations such as saudi arabia and venezuela and others. we have the oil. we have the natural gas. the nuclear capability we should be developing. the coal energy power. the biofuels. the wind and the solar. it's a complete development of the full spectrum of these energy resources which will enable us to be successful on this 21st century battlefield. if we don't do that, if we keep kicking this can down the road, we're going to put our country in a very, very bad situation. so what are the solutions? we have to develop a national security roadmap. we have to seriously start sitting down and looking and thinking about what is the world is going to look like? we did not do that after the collapse of the soviet union. we basically said after the collapse of the soviet union the
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major contention the major ideological fights in the world are over. we failed to read samuel huntington's book the class of civilizations and the remaking of the world order. and who became the bill payer? united states military. and i can tell you that because i was serving at the time when my friends who were in tank units had to use golf carts to practice tank tactics. i can tell you as an executive officer when we did not have enough money to buy tools to repair our engines and we did not enough money to get toilet paper for some of our soldiers and we did not have the money to buy the ammunition so the guys to stay out on the rifle range and we find ourselves going down that exact same path. when you study the history of the united states military in the 20th century to today, you see this. we get ready for world war i and
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we go down to a bottomless pit. if we don't have a steady state and then a plus and a minus, we will lose an opportunity to ensure that we protect america for our future and our grandchildren. we need to look at this roadmap by saying, what are the respective areas of playstation? what are the respective combat and commander area of responsibilities? and look at the threats that are there and match a capability to the threat. and that's not what we have done. we always look at the military to be somewhat of a bill payer. we always look at, okay, this war has ended so we can go down to the bottomless pit. if we miss the opportunity of recognizing what the 21st century battlefield truly is and have that strategic vision that lays down this entire world into
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the threats that we could see -- katie bar the door as they say down south. we may not be able to recover. that's what we must do. and that's why i have to tell you, you know, standing here like a great think tank of the heritage foundation and the great work they have been able to do is absolutely phenomenal but we've got to roll up our sleeves and we've got to come up with a roadmap for our national security that looks at the threat. looks at their goals and objectives because as it said in the art of war by sun su. so know your enemy and to know yourself and to know the environment and countless numbers of battles you will always be victorious. if we don't understand that simple maxim, then there could be some dark days for not just the united states of america but for the entire world because no
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matter what anyone says, we are that beacon, we are that lighthouse. we are as ronald reagan said, the shining city that sits upon a hill. that that light were to go out, it will take us into a new dark age. so thank you all for having me today and god bless you all. [applause] >> thank you, congressman west. and i just -- i was sitting there and i just have to say before i begin tossing these questions at you you're focusing on the need for strategic clarity is so welcomed in this town and we just heard some person with a vision and we have a pretty hard deadline, 11:15. there's some mild interest in your appearance here because i have all these questions. [laughter] >> so let me jump into them.
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beyond terrorism, what do you think is the greatest foreign military challenge facing the united states? >> well, as i said, i think we have to be very concerned about what china is doing. as a matter of fact, not last week the week before, china's already going into some security agreements and arrangements with pakistan telling them with j-15 fighter craft and building them a naval base and aircraft. if you look around the world you'll see the china flag flying all over going after energy resources, raw materials and i think that truly is -- if you want to talk about a conventional threat we have to admit that china is a conventional threat for the united states. >> thank you. what impact do you think the death of bin laden is going to have on the death -- on the world war. >> i've heard people say you cut
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the head of the snake and that's a lack of clarity. all you did you cut the head off a multihead hiduring that and it can generate a new dead and you can see they named a new successor with bin laden. when you have a to realize all al-qaeda and the terrorist networks have to show they are still relevant they are still viable and they must do something that continues to inspire young men who want to join their ranks and show they can bring a defeat to the great saint. and it's not dancing in the end zone. absolutely. i'm very happy we got him and then you look what happens for the next phase of the operation and that's where we have to be prepared for. >> should the united states give aid to pakistan and what about the drone used there. pakistan is one of the difficult issues of foreign policy. do you want to comment on
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pakistan and your views there? >> i was one of the first guys who said that we do need to cut off this funding to pakistan. look, i spent 2.5 years in kandahar. and any time we put pressure on the taliban, they went to pakistan. now, there's a reason why all of a sudden these groups are finding sanctuary there. they feel that they're not going to be, you know, bothered too much. either they're welcomed or i don't know. i mean, the fact that the week before osama bin laden was killed, the president of pakistan made a call over to hamid karzai and asked him to go into a long-term security arrangement with pakistan and china, not the united states of america. that's not an ally, folks. the fact that pakistan is looking to get aircraft from china. that's not an ally. china is going to go in and build a naval base. that's not an ally. you know, when i look at this incident with osama bin laden. it comes down to three things. it's either ignorance,
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incompetence or complicity. all of those bad but the sum of all three is really bad and in that part of the world it's very simple. people understand one thing, strength. they don't understand compromise. they don't understand negotiation. they definitely don't respect the appeasement. and if we continue to have appeasement and putting pressure on them and showing them that we're cutting you off and i'm going to say very simple and i know it will be put it in the media. we don't need pakistan to be successful but as long as you continue to let them believe that you need them, they're going to play you like a bad fiddle and that's exactly what's happening. >> our military is in the midst of considerable social experimentation. what efforts should congress and the topic executive leadership do to ensure that force effectiveness is sustained at a superior level? >> let me put it very simple.
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the united states military exists to win the nation's wars. when you join the military, it takes individual behavior that conforms into the military. now, if we start to have a perspective and belief in this nation that the military conforms to individual behavior, then we have lost the understanding of what it means to be in the united states military. the rules are very clear in the united states military. if you don't want to abide by the rules of the united states military, then don't join. but the united states military is not there as a social experiment and for those who will sit up there and say, congressman, you should understand because you're black. unless i'm michael jackson, i can't change my color. [laughter] >> but people can change behavior. and you do not base being a part of the military on adjusting to individual behavior. that's my concern. and when you look at what our young men and women have to
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contend with, we're talking about men and women fifth and sixth tours in combat zones. now, is not the time to appease a very small special interest group and i'll leave it at that. [applause] >> you make a great point that in the military if there's some individual activity or interest involved that works against unit cohesion or the good of the whole, the typical culture is that the individual gives way. when you were in the service, if he wanted to write a letter to the newspaper attacking the commander in chief's politics, you couldn't do it but, of course, you could do that in civilian life. okay. a couple of questions about funding. you know, why should we increase funding or sustained funding in these difficult budgetary times and then also a question relating to potential pay cuts and compensation or military benefits so maybe address that
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and where you would find balance in the department? >> well, i have to tell you when i up there doing orientation last year and i had an interview with "meet the press" and i guess david gregory thought he could trick me would you support cuts in defense spending and i said absolutely because i've been there. i know where the bodies are buried. i know where there's some fat. and so as i stand here today, you know, i found three wasteful government programs in the dod that will add up to $800 million of savings for the american taxpayer over the next 10 there's and it was there. that should be the focus. cutting the benefits that we give to our soldier, sailor, airmen and coast guard that's not the way we should go. we should look at every single way that we can increase the benefits we give to them. you can cut my pay but do not cut the pay of the men and women that we have asked to go out there and protect us. and when we talk about protecting this country that's the number 1 responsibility of
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the federal government. the federal government can create the conditions to make the american citizen as prosperous as they want. but if we cannot keep you safe, if we do not have a military that is ready to go out on this new 21st century battlefield and make sure that americans can go anywhere in the world and not feel threatened or insecure, then we've lost our mission. there should not be any possibility of americans going out on their own private yacht and having to worry about being kidnapped, highjacked and executed. that's reprehensible to me. we need to develop a military that has that type of focus, that type of reach to make sure wherever our citizens go, wherever our interests may lie, that you are safe and that you are protected. >> do you have any ideas about as you find savings where you might redirect it? obviously, you're talking about naval power. i have to emphasize again for a
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career army guy i mean, you're going to get emails from your old friends? >> well, no, i'm not i would say right now the army has more amphibious landings than anybody else so we have done very well. [laughter] >> it is a joint service. >> it is a joint service and we must understand how to compliment each other. this is the thing we would have to look at. we can take those savings and we can reinvest it into procurement. we can reinvest it into research and development. i had a great discussion with a friend of mine i've known for like thirteen years and he's the head of the rapid equipping service pete newell. and as soldiers and sailors are looking at, hey, these are the type of things we need on the battlefield and he looks at small businesses to help get off the shelf type of technology that does not have to get into the long drawn out procurement processed. those are the type of efficiencies we need to look at which will help boost our economy and get people to work and producing four our military. you know, when you think about
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what we were able to do and manufacturer and produce after pearl harbor. this is what we must start to think about in united states of america and get back to. but i think that we can reinvest those savings. we can make the department of defense more effective and more efficient but it has to be done focused on what are the tools that the war-fighter needs to be successful? and, yes, you know, we have to look at how do we project that power being it over the horizon because you look at a lot of these countries, the one thing they have in common are the -- and how do we go back into our infantry forces and the air forces but we need to retain a strong landphair, armored warfare type of force and that's where it comes back to having that national security roadmap where you sit down and you look at the respective areas of responsibility. meet with the combat and commanders and really understand what they need to be successful. we've got to have a dwell time
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for our men and women that is one year in the combat, two years out. 'cause you're killing them right now. and that's how we start to develop a force that will be capable, well rested, vigilant, and prepared. >> when i was in your position when they cut the size of the army and you'll recall because you were there and the early to mid-'90s saying we would not have to put a lot of boots on the ground which was the opinion which is why these guys are doing four or five tours. and we're grateful for your time. and hasn't he been great. [applause] >> and then we got senators over here and we have senators who take 20 minutes to ask their question. >> i'm from the south. [laughter] >> would you care to offer your opinion on what the egyptian or events in egypt might mean for the united states? >> yeah, sure. you know, i hear a lot of people talking about the irish spring
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and i do like irish spring soap. [laughter] >> but i'm very concerned once again is that someone has wanted a propaganda war and information war and having us go down a different type of math. you don't know who will fill a vacuum of leadership such as egypt. you look back in the late of the '70s when the shah of iran was deposed. who do you get? you got the ayatollah. now in the aftermath of stepping down of hosni mubarak because this is what the military teaches you, i look at the things that have happened. i look at the fact that iranian warships have transited through the suez canal for the first time in 40 years and the fact that the gaza border has opened up. i look at the fact that there have been an increased ant -- attacks in gaza and you look at the senior egyptian official have discussions with syria. i look at the fact that you have
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the egyptian foreign minister go over and have a meeting with the iranian foreign minister. i look at the fact that the christians now are fighting to save their churches in egypt. and i look at the fact that there's rumblings coming out of egypt that the camp david peace accords are null and avoided. that comes back like i said the strategic vision. for every decision there are consequences. and we have to sometimes analyze what could be those consequences. juthe same with operations in libya. i cannot understand it. i don't know what the goal and the objective are. no one can clearly tell me who these rebels or who the rebel leaders are, where do they come from? what do they seem to have. what will they bring to the table. moammar gadhafi is a bad guy there's no doubt about it. there's means to contain them. instead of our permitting our air force and navy to be a rent a force to them. so i'm very concerned about what has happened in egypt because the story has not been told yet.
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and never forget the most organized political organization in egypt is the muslim brotherhood. and you just go back to the 1920s and up to today and you can see their history. we have to have people that don't get caught up in the sound bite, and sit back and look at the second, third, and fourth order effects with the strategic clarity that senator talent talked about. and say this is a great democratic uprising. i don't see a george washington over there. i don't see a thomas jefferson. i don't see a madison. i don't see women getting any type of freedoms in egypt. so that's my concern. so the story has not been written when it talks about egypt. >> and so we experience the irony of trying to remove, i
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guess, that's the goal in libya, the dictator who cooperated on the war on terror and ended his weapons of mass destruction while we've been appeasing the dictatorship in iran that is sponsoring the war on terror and aggressively trying to get nuclear weapons. two questions, and it's a companion piece to the last question, would you care to comment on the state of our relationships with israel now, perhaps the obama and netanyahu exchange and where you want to talk about it. >> to talk about the pre-1967 borders. that was a horrible thing to say. it's a horrible thing to say when you surprised the prime minister, our most staunchest ally in the middle east. you cannot have peace in the middle east unless you have a willing peace partner. and to this day we have not seen a willing peace partner in the middle east. as golda meir simply said, that the palestinians were to lay down their weapons there would be peace but if the israeli lay down their weapons there will be
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a massacre. if we continue down a foreign policy that is very padalovian for awarding bad behavior, you're just going to get more bad behavior. once again, the thing that they understand is that you'll stand up for something. but if you are coming to the table saying, we want peace so bad you've just given them the initiative. and think about them. you give them gaza, you get rockets and mortars. you give up southern lebanon, you get rockets and mortars. you get increased participation from hezbollah. in 1967, israel responded to being attacked. and now we're going to tell them to go back to a situation that puts them in a position where they can once again be attacked. my concern is this, if we don't recognize the fact that israel could potentially fight a three-front war, with an egyptian-supported hamas with a syria and iranian-supported hezbollah, and with iran who is
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developing a nuclear capability and iran with a leader who stood in southern lebanon and faced toward israel say we are for the elimination for the zionist state, i mean, how much more do we need to be convinced? see, my fear is that it takes a cataclysmic event. how many people understand the mad theory, mutual assured destruction. the m.a.d. theory we had with the soviet union does not exist with iran. because they need to have a cataclysmic event to bring back the hidden the imam, the mahdi. that is the whole reason about having a nuclear device, which they will turn against israel. i don't care how much land you give up. it is still about the elimination of the jewish people. and the fact that mahmoud abbas
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and the palestinian facility, and they went for the elimination of the jewish state and the jewish people, then that's not how you start talking about peace. until you eradicate or eliminate hamas and that's my story and i'm sticking to it. [applause] >> final question, i don't know whether you want to share in this but i had too many questions to ignore. you have a lot of friends here who are interested in your potential prospects for the future so i'll just put it that way to you. would you care to comment? >> i heard potentially there's an open for national dog-catcher. [laughter] >> so i will maybe throw my hat -- look, the most important thing is that the founding fathers were brilliant when establishing this federal government. and we have to understand being a congressional representative is a very important role to play and the house of representatives when you look at the constitution and understand the
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powers that they have, it's important you have strong voices there. most important thing to me is to prove myself as a great american statesman, a capable legislature and learn their squirrely words and unanimous consent and what they have over there when you're in georgia it seems like this kind of stuff is kind of crazy. [laughter] >> but that's what my focus is running for re-election in the united states congress. but i will always tell folks at the bottom of my heart, that, you know, i submit myself to the will of god. and as i was saying with danny, in 2007 i was sitting in kandahar, afghanistan. four years later i'm standing here. this is a great country. this is an incredible country. that anyone has an opportunity to go as far as they want to in this great nation. i am happy where i am as a congressional representative. and if god has something for me in the future, that's god's
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decision between me and my wife and my family. but for right now, let me be that which the people in florida's 22nd congressional district worked hard to get me to. and that's to be their u.s. congressman. so thank you so much. [applause] >> thank you, allen. [applause] >> i do think they like you. [applause] >> thank you, allen. we've had a number of speakers for protect america month the last several years, none more eloquent in defense of america's interest and on behalf of the strategic clarity and the war-fighter so thank you and we're glad that you're running for re-election. thank you all very much. and we are dismissed. [applause] >> thank you. thank you very much. [applause] [inaudible conversations]
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[inaudible conversations] [inaudible conversations] >> we
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[inaudible conversations] [inaudible conversations] >> so the hearing from congressman allen west who is a memory of the arms services committee also a retired army lieutenant colonel and an iraq war veteran. he's expected back in a few minutes to answer questions from reporters. meanwhile, the house today is voting on raising the federal debt ceiling. the "new york times" writing
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that in a bit of political stage craft house republicans plan to bring to a vote a measure that the president obama and the democrats were demanding a few months ago a clearing of the debt ceiling on any requirements that spending goes on to say. given that all republicans and more than a few democrats pools any debt limit increase that is not accompanied by some commitment to future fiscal restraint, the measure is doomed to fail. and for all the talk of economic crisis, should congress fail to raise the debt ceiling by august, the financial markets are likely to yawn at the vote. so we'll see a little later today how that vote goes debate beginning at 4:45 eastern time. votes in the house are scheduled at 6:30. you can see all of that happening on c-span.
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[inaudible conversations] [inaudible conversations] >> expecting congressman allen west here at the heritage foundation to answer some questions from members of the press. a little bit more about the house today coming in to raise
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the federal debt ceiling actually debate that issue. and because of the way the legislation is being considered it will need a two-thirds majority to pass. that debate begins at about 4:45 eastern. tomorrow in the house military operations in libya and on wednesday, the house members go to the white house to discuss the federal deficit. a little later on this afternoon, the house panel look at autism cases in other countries and now children can get medical care in developing nations. live coverage of the house foreign affairs subcommittee meeting begins at 2:00 eastern here on c-span2. and at the same time, live on c-span3, a house energy subcommittee holds a hearing on security of the u.s. electric grid. threats to the power infrastructure, possible weaknesses in the system and how to defend the grid from cyberattacks. that's on c-span3 at 2:00 pm eastern time. going back now to the heritage foundation, congressman allen
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west, a member of the arms services committee is expected to talk with reporters. [inaudible conversations] [inaudible conversations]
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[inaudible conversations] [inaudible conversations] [inaudible conversations] >> after speaking to the audience earlier, congressman allen west, a member of the arms services committee is going to talk with reporters, answer some questions. >> so if you guys have a question, sure to state your affiliation before asking.
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[inaudible] >> your cell phone should remain off during this time period as well. so if you have a question, just raise your hand. >> nicholas with cns news. you talked about the dangers of occupational warfare and nation-building. what do you think should be the united states' position with respect to the war in afghanistan should we pull out our ground troops in the war in afghanistan? >> i think when you have a to do is look at how you take some of the bases you've established and they can become a rotational type of base. but the most important thing is, you know, when we start to get into a broad game of the nation-building, the schools and the infrastructure and things of that nature, that you takes the soldiers, sailors, air marines what they should be. there's a certain thing that we have done all we can do in afghanistan and we must be able to accept that 70, 75% solution
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and i think it comes back to once again what are the conditions that we want to try to achieve in some of these theaters of operation and then once you reach a certain percentage of those conditions, then you have to look at what the next phase is and moving on. i don't like time phrase of operations where you tell someone on this date that i'm going to do a such and such an operation and i think that's telegraphing to the enemy. >> maggie, inside the air force. you briefly touched on how you identified three wasteful government programs in dod. and i was wondering, what those programs are, how you identified them and if you could just sort of break it down for us? >> yeah, we worked with the arms services staff because, you know, i told them to go out there and look for some places where we could make the cuts. one of the things that i remember when i was a young staff officer in the military, i hated doing powerpoint briefings and so we looked at the printing
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and reproduction program. we looked another program like a research program that was not very profitable and then also a work force in rewards program and so we targeted those three. and they passed through. the national defense authorization act and over the course of 10 years they saved the american taxpayer $800 million. >> i just want to get to you elaborate a little bit afghanistan situation particularly since there's been talk of -- there's been talk of talks with the taliban, reconciliation, reintegration these sort of things and these sort of words have been thrown around. what do you make of that whole process of trying to get the taliban to become part of the broader view of the future. >> we tried that with the clinton administration and we recognized the taliban as a legitimate government and look how far that got us. this comes back to what i think
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is the most dangerous thing out there is our own political correctness. and our own inability to understand who the adversary is and what they truly believe in. i'll give you a great example is when we kick around this term about radical islam and then the president and the prime minister of turkey said there's no such thing. so if you don't start listening and taking the enemy for who he is, so that's just the taliban, then you can't have a reconciliation with an individual whose vision is totally different and not in concert with 21st century, i think, morals and values. so, no, you can't sit down and negotiate with a group like the taliban. and i can tell you, that is the number 1 thing that is going to cause people not to believe in the united states of america when we say that we're going to have talks with the taliban because, what? if i'm a tribal leader in afghanistan who do you think i want to throw my hat in. fink you're about to leave and
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you don't to see any change in these individuals and i know what they did when they were in power, and we must not forget, it was the taliban who brought al-qaeda into afghanistan. it wasn't the opposite. >> are there any other programs that you're eyeing in the future in terms of being able to -- >> oh, yeah, this is -- this is -- i mean, this is a revolving process. i mean, it's not just you come in and you have an opening salvo and then you quit. i mean, i want to continue to look at, you know, efficiencies in the department of defense to make sure we streamline and get a focus what its core missions and core functions are. >> hi there. i'm with the heritage foundation but several of the reporters that are joining us watching online have sent me this question. they want to know sort of your thoughts on president obama's nomination of general martin dempsey as chairman of the joint chiefs of staffs and what do you think of that nomination?
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>> i have met general dempsey before, of course, you know, had some discussions with people over the weekend who have, you know, known him. he's a soldier's soldier. i think but the important thing to understand is that now we are taking someone away from, you know, training and command of the army and taking him away from an operational combatant and commander and now we're talking about him being a force provider and the number 1 advisor to the president. so i would hope that he will understand this battlefield situation and help the president to make the right type of decisions based upon the counsel that he receives from the respective service chiefs. so i look forward to general dempsey continuing on his lifelong career of service and i got to tell you i'm kind of glad that the army has a chairman joint of chiefs. [laughter] >> this will be our final question. >> you talked about feeding the enemy in the information war. >> yeah. >> could you give some examples of the messaging that the united
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states should put out with respect to the wars in afghanistan and iraq? >> combat fears of operation in iraq and afghanistan. we don't talk about the successes we don't talk about the things we've done and we don't talk you have a thriving and vibrant economy in the kurdish area with international flights and things of that nature coming in. so i think those are the type of things we have to discuss. we don't talk enough about some of the vicious attacks that the taliban does. you know, when i was over in afghanistan, you know, countless times i mean, these guys gunning down little girls going to school. throwing acid on them. we have to show them for who they are. and not allowing them to, you know, dominate the dialog and have the initiative across the websites and the information arena. so those are the type of things i think that we need to do a better job of doing is really telling the stories and showing some of the good news stories that are happening over there in these theaters of operation. >> thank you so much. >> thank you for having me.
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>> if you have follow-up questions feel free to contact him. >> thanks for the cameraman. ..
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>> now a discussion on journalism in the digital age. we begin with remarks from "washington post" reporter bob woodward. he is joined by a journalist represent russia, pakistan and al-jazeera. >> good morning, everyone. it's a big, big treat and pleasure for me today to welcome the marine corps commandant general james amos to brookings. i'm michael o'hanlon. peterson and i would like to welcome you all. we have an opportunity here from the commandant on a number of issues that i know this crowd needs no briefing on their report, everything from the
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status of marine corps modernization efforts to the status of the war in afghanistan, to have various budget exercises may be going at the pentagon to the extent we can talk about those today. but i want to begin just briefly with a word of appreciation for the general. i was very fortunate to be with him and his team in afghanistan recently watching him and his outgoing sergeant interact with them rates. it was an inspirational experience to watch how these to a plotted, supported and boosted the morale of the reins and i know it went in both directions because they give you inspiration. they were incredible to watch in the field, and so i just wanted to make that brief observation, general. but really i want to just welcome you to brookings and look for to the conversation and maybe ask everyone else to join in a round of applause as well. [applause] >> and, of course, there are some big issues but if you don't
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mind if we could start with afghanistan. if i could just ask you to give your assessment of how you see things going based on the trip, based on all the things you are following here in washington and learning about and so forth. >> we had a great trip. we are on the ground for about five days. did our best in the helmand province, without question, but we do best to try to see as many of the 20,000 marines and sailors as we possibly could. this is my almost 40 are going in and out of afghanistan. as we talked, i've watched it change over those four years. i've watched areas that were, i mean extremely dangerous and under heavy taliban control, to places where you and i got out now and didn't have body armor on and we are out shaking hands with folks. so i have watched it change. our piece of responsibility is
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out west of that. my sins, my is there is a reason for optimism. i use that term because i try to avoid the winning or losing, which folks want to gravitate to. and i reference that are just things i have seen. the district governors, all of mayors in america, district governors, courageous man, stepping up and rebuilding their towns. and setting up marketplaces in getting children to school. i look at it, just talk to some folks this morning about children going to school and little girls going to school. i mean, this is, this is a nation that didn't value education for their girls. and yet we have gone in and out of schools now, and you see those beautiful young afghan children, the girls, all with
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their resplendent dress on and going to school. so i am encouraged by that. i'm encouraged by the markets that have opened up, and probably even more so just the leadership that you and i saw, everything from the provincial governor all the way down to those district governors that we have seen. i think we have talked about the taliban spring and the spring offensive. the taliban, if they be returned, and they will with certain numbers, are going to see completely different helmand than when they left last fall. so i'm encouraged that i think there's reason for inclusion. i like david patrice's comments about its fragile and reversible. i think that's realistic. but i am encouraged, and i will tell you that i'm convinced that we've got the right formula to
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take care of the people, helping set of the governments, the local governments moving along those lines. >> let me ask if you don't mind about how your marines are doing, and they are working very hard. i just mentioned that i have a great good fortune and pleasure of seeing how they rally to the efforts of which are asking of us, what we are all asking as a nation. and it's inspiring but it's also got to be tough. of course, your own experience in combat was largely in iraq, and that was now getting to be i think eight years ago when you first went in. so we have been at this war for a decade. as karl reminded marines would've the talk to them in the field and talk of how they created their own legacy, that there is the bravest marine warriors as in any generation. it's got to be tough on people. is incredible how often when you ask oaks in the field how many of you on your second or third deployment, and almost everyone raised their hand and one count on meeting today.
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i remember you posting that question. how are you holding up, how much longer can we ask this of them, are there any measures we need to take now to adjust the burden we are placing on them? because it's potentially getting to be too much. >> i think we have to communities. we've got the community of the -- i can't speak for those other services. but for us we're always asking how is morale, what is reality? you know, we do sometimes a more senior you get, you get accused of your not in touch with what's really happening out there, down at the youngster level. and i don't think that's number one the case. so we have the active duty young marine, and in some cases the active duty old marine. but the young marines and we have their families. so we have two different communities that we pay very, very close attention to. the war fighting peace, the counterinsurgency peace.
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that's separate. but let me talk about the young brains first it is almost counterintuitive, and you saw that with the morale, is extremely high. and i'm always hesitant to say that in public because people look at me say joe, you're not plugged in. actually, i think i am. and i think carlton kent is anything our commanders are. i think our generals r&r colonels. morale is very, very high, and it defies in some cases just a normally we think about things. the kids like doing what they're doing. a good example is we just pull the battalion out of the northern -- northeast part of afghanistan. they rotated home just about a month and a half ago, and they thought all through the fall from about october until about march of an area called -- it was really a dangerous area for
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the helmand province. and they had a lot of casualties. both wounded and marines that we lost. and yet you could be with these kids. we were there at christmas time with them, and we just miss them when you and i got there. and their morale was off the page you. you're wondering how can that be? i think it's who we recruit, how we trained them, and the expectation of the legacy. most of the marines are on at least their second or third. you'll be surprised the numbers on the fifth, sixth and seventh deployment. their morale is high. they like doing what they are doing. not every marine comes in and says i like it so much i want to reenlist, but i will tell you our reenlistment rates are off the page. all the things i look at are the measures of how we are doing, are up. if you want to be a marine today and you walk into a recruiter's
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office, in macon, georgia, or someplace across our great country, it will be seven months. you sign the papers, it will be seven months before we can send you to begin. and the other thing is kind of a litmus test is these young men that come in, it's been women, come in and they want to be in the infantry. and yet the infantry is kind of the currency of this war, is that young 18, 19, 20 year-old man, in some cases young women. and they are, they are the currency. morale is high. and they are willing to return with their brothers and sisters again and again. the other thing is this piece that they feel good about it. you know, we often don't see that they feel good about it in the papers back on. but they feel good about doing what they're doing. they feel like they're making a difference. if you like when they are in a village and watch the market come to watch -- life, they feel
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good about that. second is the family. we spent a lot of money up a lot of effort. not the money is a measure of family, but we recognize as the family goes, so goes the marine. and we've got i think certainly leading family programs, things we're doing, great concern from all the way down to our family study take care of them and provide them with information trying to care for them, trying to take care of their needs, understand the psychological strain on families as their husband or lover or spouse goes to the second or third or fourth deployment. so, i personally feel the strain on the family is more than i do. >> let me just follow-up on one policy question regarding this issue because it has to do -- the only question i'll try to post you about july 2011 and what it means to the drawdown because as a sensitive topic where discussions are ongoing, but if you want to make sure i'm hearing you right because we
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know about for years ago a different generation of joint chiefs was very concerned about the surge in iraq. and it wasn't so sure that the force could sustain a. and that was an ongoing subject of discussion between general petraeus when he was commanding in the iraq, and some of joint chiefs back home. if i hear you're right, you are saying yes, there are multiple considerations that have to go into drawn down our health as we draw down forces this summer, but the state of the marine corps is not one of them. in other words, the marines can do what they're asked to do or whatever pace the president-elect to do. >> absolutely. there's no doubt in my mind about it. and i think you saw this by some of the questions that came up. when we met with the marines, we always opened it up to questions, any questions they wanted to ask. we quite often got the questions about general, how are we are going to be able to complete what we have started your? that was the typical crescent
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that came out of the youngsters, and some of the oldsters out the. are we going to be able to finish what we have started? are we going to be able to ensure that the iraqi army -- excuse me, the afghan army is now trained up and imposition along with the afghan national police, or the afghan police to be able to sustain the area, keep the taliban out, and allow the culture in that little community to try to seek a sense of normalcy again. that's their concern. so it's not a matter of can we sustain. the answer is yes. i'm really not worried about that. >> before i turn to the budget which is the other main area i wanted to discuss with you prior to opening things up, i did want to ask about libya, if you don't mind come in passing at least because you have experienced in italy, and in nato, and we went to naples on a trip and got some great things. you also have experience with
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the operation in kosovo, a dozen years ago, and which we tried use air power to achieve an affect on the battlefield. and by the way, i'm sure many have seen the news today that it appears he was well until arrested. you're a marine corps aviator, and i can tell the crowd he still flies airplanes extremely well from personal experience. i was able to see that firsthand. but you also know what air power may be can and can't do. and i wonder if you had any guidelines for us about how we should think about the libya campaign now. is this the sort of thing where you feel very good about it, we think we'll have to breath as the united states do more to help our allies and where we'll have to consider escalating some way, shape, or form where we're really patient is the most important virtue and if we just take it we will be okay speak with i think your last point is something important for all of us to remember.
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win this thing was first, when the world's attention had changed from tunisia to egypt and then kind of in between in libya, different pockets rose up and wanted to move quick, wanted to move very, very quick. other folks wanted to be very cautious and move very, very slow. my sense is we have got it about right and i think at this point tactical patience is probably in order. one of the things we talk about when we talk about our young lieutenant colonels that are in graduate schools is when you're dealing with the national diplomacy level, things are not always crystal clear like they are when you're in a crass -- clash of a classroom you have a problem and the professor pretty much knows, at least the two or three best solutions are. when you are getting on the national stage around the world, the international stage, it's
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not always clear what the next best move is. my sense is i think the united states handled this just about right. and i think nato, nato, you know, we are a member of nato, or a teammate of them. and i think nato stepped up, and even though everybody said we should have done it this way, i think if you step back and look at it we probably handled it just about right. >> i want to ask a couple questions on the budget. i know it's an ongoing discussion. i don't think i'm telling any secrets when i can tell the crowd after spending a 14 hour day in helmand province going from base to base out in the sun giving these speeches and have a ton of meetings and listen to the concerns of the marines, general amos had to get up at about 1 a.m. to do a video teleconference with the chiefs back home because of the pressing demands of the ongoing budget. so i admired your hardiness and your strength and i'm sure it's not over yet with those conversations. so you probably can't tell us everything we would love to know, but what can you tell us
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about the nature of the ongoing exercise? and specifically, is the $400 billion number that the president outlined on april 13 in his speech, is that set in stone or is that a number that you sense is really subject to reconsideration as the chiefs and others have a chance to weigh in on what that number would mean for the size and strength of our military? >> i can't talk about whether the 400 billion is locked in concrete, mike. i don't know. but i think the greater signal was to the department was okay, our nation is working its way through some fiscal, some realists serious fiscal struggles right now. and everybody has to be part of the solution. and our secretary has been pretty strident, you know, a year ago we worked through about
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$100 billion worth of deficiencies. in our case within the marine corps, we found a significant amount, and actually applied them to kind of recap why some of our equipment and some of the things, some of the near-term expenses in 12 and 13 and 14. so we actually spent that money pretty efficiently. so, i don't know precisely where this is headed, but the one thing the department has is, it has the message. in other words, it understands that we are team players in this. so where we are right now, there's no numbers within the department of defense. there's no marine corps. this is your piece of this, none of that has happened yet. rather at this point, you know, the secretary, in just typical the wise way he does business, he said let's take a look at the strategy first. in other words, if our nation is
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going to begin to draw down its military and take, reduce the department of defense is part of the federal budget, then let us, put that on pause momentarily while we take a look at strategy. in other words, what is it the united states of america needs of its military, the department of defense. and i tell you what, i think all the service chiefs are in line on the. what is it that america wants? its department of defense to do. i think we could run on that in qdr 2010. but qdr 2010 was a year and a half, two years ago. and fiscal landscape has changed. so if you take, if you take what is it that our nation needs department of defense, not with the marine corps needs itself to do or not what the other services do individually, but our nation, what does it need the department of defense to do. and you start there. and then you say okay, based on
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that i have all these things that i would like them to do. i would like them to be forward out like a forward presence around the world. sake do that? and u.s. the capability to do that and what services. then i would like you to be able to do this, this and this. you come up with your list of a dozen major things that the military should do for our nation or has to do, and then you say okay then you late the budget. and this is kind of were i am right now. as the commandant, i look at what's going on in the world, around in the world in afghanistan, helping our japanese brothers and sisters of the northern, helping out with the humanitarian, the disaster to place of the northern pakistan when the floods came. all the things that we do, and then i have this kind of nexus of budget reality, and they're all kind of coming together. and where they cross is what i
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think very, very close attention to, because i don't think we're going to be able to do everything that everybody wants in the future. so the issue now is back to the strategy, what does our nation want of its military, then who can provide it, what services can provide that, what is in here, what have we already pay for, and in what is it we can't do. because we can't afford it. and then, and this is, i think this is, it's all important this is a very important part of this because if we say that this is important to our nation and we want the department of defense to do this, these things to this degree, and then we lay that on top of fiscal reality, and we say okay, we can only do this much and these things we can't, we are no longer to be able to do. that becomes a risk. and whenever we are doing real
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operations around the world, there's always risk in every single thing that happens. every war plan, every operation we have been involved in eventually comes down to pieces of risk. and so then you have to ask yourself the question, how do i -- i can either ignore that risk, or is there a way i can mitigate that risk? in other words, is there a hedge? is there something that i can do in the event that this does happen that i can -- that i'm going to be okay because i mitigated it with this typical. i will be honest with you, you've asked the commandant of the marine corps to come and speak, so forgive me for being just a little bit pro clear for justice and another by joint chiefs hat back on. i think that's what we do. that's what the marine corps does for our nation. we are our nation's insurance policy. we are that hedge against that
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risk that we may not be able to have everything we want or be able to do everything we would like to do, but those elements of risk is there a way we can mitigate it. so that's kind of were i think we fit in. >> i would like to ask you in a minute about the main modernization efforts of the marine corps. and, of course, we know that these are ongoing major concern for you. one of your first acts of commandant making big headlines was of course to cancel the expeditionary fighting vehicle. you've also now gotten a big burden in shepherding the so-called f-35. this graduate probably an even mix of people who know a lot about the f-35 z. and people are more generalists, so maybe once i post a question you can just expand a little bit about how the airplane fits into your strategy. and, of course, there is the osprey which is the tilt rotor aircraft that is doing so well in afghanistan.
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and i know you have been pleased with that. am i correct in asking about these three sort of in a sense that not the only important marine corps modernization items, but in many ways what gives the marine corps and its unique capabilities and characteristics and three systems that are really at the center of your concern as commandant. and then how do you see these three, especially the f-35, these three programs going forward? >> you go back to kind of the mission of the marine corps, to be the forward deployed, always ready force. a couple things that are employed in the. number one is that you are ready to respond today. to today's crisis. you don't have -- you have to back up and say i will be there in about 30 or 40 days but if you give me enough time to gather my stuff together, i will
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put it on chips and put it on airplanes and i will like it there, or drive it. so this term expeditionary really is for us it kind of caught on about four or five years ago, people piled on, but it's our mindset. it's the way we think. we buy equipment. we buy equipment that fits on chips that you can swing underneath helicopters, that you can put on and get it on chips. so everything we talked about, these three programs, albeit without expeditionary nature of the marine corps. truly, the ability to be america's crisis response force, today's crisis and today's force today. be 22, i was in the pentagon when it was struggling and we used to talk, we told folks because it was really a vision
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and. it wasn't, it was a program that airplanes were flying, they were struggling. and we said look, this will give us the ability to carry three times as much -- excuse me, twice as much, fly three times as far and fly to and half times as fast. it certainly has proven to be -- that b-22 right now is on his ninth deployment, six combat deployment. and you and i flew around. i suspect that hide it that was running from the libyans that night was very thankful he didn't have to wait another two hours on the ground for a traditional rotor wing airplane to get him. because from the time the ship was notified of his going down in libya, to the time they
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launched, found him, pulled him out, off the ground and brought them back, it was 90 minutes. instead of four hours or four and a half hours. to b-22 allows us longer range, greater payload. you flew in it. you could fit for combat loaded marines and with all their stuff very comfortably. you can get in and out of landing zones very safely. the truth of the matter is, even though it had a publicized start, right now it's the safest airplane we have in the marine corps. it just passed 120,000 flight hours. we can take forces and we can self deploy the airplane around the world. anywhere. the expeditionary fighting vehicle, it just became too


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